Logo of Phnom Penh Post newspaper Phnom Penh Post - VN ride-hail apps struggle to compete with Grab

VN ride-hail apps struggle to compete with Grab

Content image - Phnom Penh Post
A Grab motorbike taxi rider plies between vehicles on a street in Hanoi on April 19. Roslan RAHMAN/AFP

VN ride-hail apps struggle to compete with Grab

Vietnamese ride-hailing businesses are still struggling to grab market share even after the departure of Uber from Southeast Asia and complaints about the top ride-hailing app Grab.

After Uber’s exit, Vietnamese apps TaxiGo, Vivu, T.net, Xelo and Vato were set up to compete with Grab. But they have failed to attract as many passengers, mostly due to lack of advertising and promotions.

After Uber left, Grab’s rates increased, especially during peak hours, holidays or during bad weather, according to many passengers in HCM City.

Tran Thi Kim Hong, 50, of HCM City’s District 4, who uses Grab to go to work every day, said: “They no longer offer discounts as much as before, with prices rising 10-20 per cent, and even 50-80 per cent during peak hours.”

The peak period now is one hour longer compared to the past period. “The rates also went up during non-peak hours, especially in areas where there are fewer cars,” she said.

Grab drivers have complained about high commission rates, nearly 20 per cent for veteran drivers, and more than 28 per cent for new drivers.

Biggest market share

Some drivers said they were working more hours but earning less money, while others who took out loans to buy a car said they were driving 10-12 hours a day so they could pay back their loans.

Despite complaints from drivers and some passengers about Grab, the company still retains the biggest market share.

Vietnamese companies have invested less in advertising and have had fewer promotions.

In addition, since many of them do not have enough cars and drivers, passengers often have to wait for a long time.

‘Best service will win’

In some areas, for example, passengers have complained that it was difficult to get in touch with Vato, which received a $100 million investment from Phuong Trang Tourism Service and Transport JSC in a bid to compete with Grab.

Although the prices for T.net and Xelo are reasonable, passengers have also complained that it was difficult to reach them by phone.

To attract drivers, many Vietnamese businesses have exempted the commission rate for drivers during the initial period, and then later take a low commission rate of no more than 15 per cent.

However, due to a limited number of passengers, the local businesses cannot find enough drivers.

Drivers for the Vietnamese businesses have also complained about changing policies.

As soon as revenue increases, the company’s commission rate usually goes up as well, they say.

As of the end of 2017, Grab had attracted $2 billion worth of investment from partners to serve the Southeast Asian market. In May, Toyota raised $1 billion for Grab.

Meanwhile, most Vietnamese ride-hailing app businesses must rely on their own resources, and have not called for investors.

Nguyen Xuan Thuy, of the Division of Transport at the Ministry of Transport, said: “What [Vietnamese passengers] need is good service at a reasonable price.”

“The more competitive the market is, the more customers will benefit. It’s important that Vietnamese businesses recognise their shortcomings to improve their services,” he said.

Economist Bui Quang Tin said Vietnamese ride-hailing apps should take advantage of Uber’s exit from the commercial arena to expand their market share and offer more choices for local commuters.

“Those who provide the best service will be the winners,” he said.

As of April 8, all Uber rides had shifted to the Grab app, which meant that former Uber drivers had to either join Grab or stop working.

In the deal when Grab took over Uber operations in Southeast Asia, Uber was allowed to retain 27.5 per cent of Grab’s shares.

MOST VIEWED

  • Bareknuckle champion wants Kun Khmer fighter

    Dave Leduc, who is the current openweight Lethwei boxing champion in Myanmar, has announced that he will travel to Cambodia this year to challenge SEA Games gold medallist Prum Samnang any time that is convenient, after their planned match later this month in Slovakia was

  • Five-year-old Hanuman dances his way into hearts of Cambodia

    A young talent from a new-established settlement has emerged, captivating the online world with his mesmerising performances of the traditional Cambodian monkey dance. Roeun Kakada is a five-year-old prodigy who has taken the social media sphere by storm with his exceptional dance skills and dedication

  • Fresh Covid warnings as Thai hospital fills

    A senior health official reminds the public to remain vigilant, as neighbouring countries experience an increase in Covid-19 cases, with the latest surge appearing to be a result of the Omicron XBB.1.5 sub-variant. Or Vandine, secretary of state and spokeswoman for the Ministry of Health,

  • PM declares ASEAN Para Games open

    The 12th ASEAN Para Games officially kicked off on the evening of June 3 at Morodok Techo National Stadium in Phnom Penh, with a spectacular opening ceremony featuring fireworks and performances by some of the Kingdom’s most accomplished talents. Tens of thousands of sports fans

  • Honda shutters Siem Reap football club

    Japanese football legend Keisuke Honda, the owner of Siem Reap football club Soltilo Angkor FC, has been forced to shut the club down, after it failed to attract sponsorship for the upcoming season. Honda, the former manager of the Cambodia men's national football team, said

  • Waterway job still pending for Kampot tourism port’s opening

    The search is still on for a contractor to expand and deepen the Kampot International Tourism Port’s waterway and deliver additional enhancements allowing safe access for larger vessels, nearly a year after the main construction work on the 4.25ha site was completed on June 30, 2022.